Diamondback Energy Inc (FANG) stock analysis
Diamondback Energy Inc (FANG) clears 4 of this site's 8 mechanical value filters, 5 of 8 Buffett-style checks and 2 of 5 Lynch-style checks. At $197.14 it trades 10.5% below this site's neutral DCF value (a margin of safety of +10.5%). Its earnings quality rates Mixed. Figures are as of October 23, 2026, from SEC filings and market data refreshed weekly; this is educational analysis, not investment advice.
Data as of October 23, 2026. Refreshed weekly from SEC filings and market data.
What does Diamondback Energy do?
Diamondback Energy is a US independent oil producer concentrated in the Permian Basin of West Texas and New Mexico, drilling shale oil wells.
Brands and businesses it owns
- Viper Energy
What stands out about Diamondback Energy?
- The share price implies 5.2% yearly growth. At $197.14, FANG's free cash flow of $12.90 per share would have to grow 5.2% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for less growth than the baseline. Change the assumptions.
- Misses 2 of the 8 value filters. It fails Trailing P/E < 25 (38.35) and PEG Ratio < 1.5 (5.42); the other 4 pass and 2 were not evaluated. See every filter.
- The margin of safety is falling. It went from +18% on Oct 7 to +11% on Oct 23 across 5 weekly readings. See the trend.
- Weakest against peers: return on equity. At 4% (peer median 16%) it ranks 21st of 21 among energy stocks this site tracks. See the ranking.
- Earnings quality: Mixed · 1 flag. Beneish M-score −3.03 · accruals −10.3% of assets · 259% of profit arrived as cash · share count +26.7% a year. From the latest 10-K (year to Dec 2025). See the Earnings Quality Screener.
How has Diamondback Energy's share price moved?
The interactive price chart needs JavaScript.
Is Diamondback Energy undervalued? The value diligence check
Every value-investing signal this site computes for this stock, gathered in one place: the same real numbers from the tools below, not a new score.
- Margin of safety (DCF) +10.5%
- P/E vs. its own history 38.4x · at/above its priciest point Real range: 5.5x–26.1x over 5 years (net income per diluted share from each fiscal year's 10-K, paired with the real closing price at that fiscal year-end).
- Wall St. analyst rating Buy · 4.13/5 38 analysts this month: 10 strong buy, 23 buy, 5 hold, 0 sell, 0 strong sell (Finnhub). Down from 4.14 last month.
- Altman Z″-Score (bankruptcy risk) 1.70 · Grey zone
- Earnings quality (is the profit real?) Mixed · 1 flag Beneish M-score −3.03 · accruals −10.3% of assets · 259% of profit arrived as cash · share count +26.7% a year. From the latest 10-K (year to Dec 2025) - see the Earnings Quality Screener for how each check is scored.
- Shareholder yield (cash back to owners) 2.1% gross Latest fiscal year (2025): dividends 2.1% + buybacks 0.0%. Stock comp is not reported in its filings, so no net figure. Over 12 years its split-adjusted share count rose 583%. See Shareholder Yield Leaders.
- Capital needed to grow (See's test) $14.31 per $1 of new profit · Capital-hungry · but only 7% return on capital Operating profit $516M → $3.4B, capital needed $10B → $52B, 2016–2025 (3-year averages); return on capital now 7% before tax. Buffett's See's Candies needed $0.42 per $1 of new profit, FlightSafety $3.20, a typical grower about $5. Cyclical: the answer depends on where in its cycle the window starts and ends. See Capital-Light Compounders.
- PEG (growth at a reasonable price) 5.42 · Well above fair P/E 38.4× ÷ 7.1% a year of growth behind it. 414th lowest of 447 stocks with a usable PEG. Lynch's fair value is a PEG of 1; a very high PEG usually means almost no growth, a very low one a profit spike. See PEG Ratio Ranking.
- Compounder lenses (4) 1 of 4 · misses capital-light, real profit, price Capital-light growth: not cleared (only 7% return on capital); Profit is real: not cleared (1 earnings-quality flag); Cash to owners: cleared; Fair price (PEG): not cleared (PEG 5.42, over 1.5). See Compounders at a Fair Price, which also lets you move the PEG bar.
- Value trap check Clear
- Munger's Inversion Check 0 flags
- Standing vs. sector peers 3 of 7 measures above the median Compared with the 20 other energy stocks this site tracks: 1 in the top third, 3 in the bottom third.
- Dividend payout sustainability 0/6 · clean
How does Diamondback Energy compare with its peers?
3 of 7 measures sit above the median of the 20 other energy stocks tracked here, 1 in the top third and 3 in the bottom third.
- P/E ratiolower is cheaper · peer median 17.2× 38.4× ✕20th of 21
- Free-cash-flow yieldhigher is cheaper · peer median 6.5% 6.5% –10th of 21
- Return on equityhigher is better · peer median 16% 4% ✕21st of 21
- Net marginhigher is better · peer median 13.5% 8.6% ✕16th of 21
- Revenue growthhigher is better, year on year · peer median 11.2% 21.4% ✓3rd of 21
- Debt / equitylower is safer · peer median 0.45 0.33 –9th of 21
- Dividend yieldamong dividend payers · peer median 2.10% 2.10% –12th of 21
Peers are the stocks this site tracks in the same sector group, not every listed competitor. The bar runs from the weakest peer (left) to the strongest (right); the tick is the middle. Measures that don't apply to a sector (cash-flow yield for banks, debt for financials) are left out.
What would Buffett & Lynch say?
Buffett's checklist is built around durable, profitable businesses bought at sensible prices, and FANG doesn't clear enough of it yet. In its favor: FANG and has kept that profitability up over five years, not just this year, carries a conservative amount of debt relative to equity, earns many times its interest expense, so debt service isn't a worry, is trading below what a conservative discounted-cash-flow estimate says it's worth - his own "price is what you pay, value is what you get" test, not a fixed multiple ceiling, and trades at a reasonable multiple of owner earnings, his own term for the real cash a business could pay out. Where it comes up short: FANG isn't clearing the return-on-equity bar he'd want to see right now, runs thinner pretax margins than he'd like to see, and hasn't grown earnings per share fast enough over five years to impress him.
- ROE (TTM) > 11% ✕
- ROE (5yr avg) > 11% ✓
- Debt/Equity < 0.5 ✓
- Pretax margin > 15% ✕
- EPS growth (5yr) > 7% ✕
- Interest coverage > 5x ✓
- Trading below intrinsic value (DCF) ✓
- Price vs. owner earnings < 25x ✓
Lynch looked for growth stories that weren't overpriced for that growth, and FANG falls short of his bar. In its favor: FANG isn't over-leveraged for a company of its type, and converts earnings into real cash at a reasonable price. Where it comes up short: FANG doesn't pay much of a dividend, which is the main reason to own a slow grower in the first place, isn't even growing at the modest pace he'd expect from a slow grower, and is priced too rich for how little growth is actually left in the business.
- Dividend yield > 2.5% ✕
- EPS growth 0%-10% ✕
- Debt/Equity < 0.6 ✓
- P/E < 20 ✕
- Price/FCF < 25 ✓
Quantitative approximations of each investor's documented approach, not endorsed by either investor or their estates - commentary, not this site's actual ranking criteria. Buffett never published a numeric checklist: only 2 of his 8 checks here trace to his own documented concepts ("owner earnings," from his 1986 shareholder letter, and "price is what you pay, value is what you get," his case against fixed P/E/P/B ceilings) - the other 6 (ROE, debt, margins, growth, interest coverage) use commonly-cited thresholds that are not numbers he himself published. The 8 hard filters below (plus the Munger check and Graham margin of safety) are this site's real, mechanical screen and are computed completely independently of the checklists above.
Berkshire Hathaway's own filing
Which of the 8 value filters does Diamondback Energy pass?
- Market Cap > $25B $56.3B
- Trailing P/E < 25 38.35
- PEG Ratio < 1.5 5.42
- Price/Book < 8 1.48
- Price/Sales < 7 3.29
- EPS Growth YoY > -5% +179.7%
- vs 50-day MA (±12%) Not evaluated †
- vs 200-day MA (±12%) Not evaluated †
What is Diamondback Energy's margin of safety?
+18% on 2026-10-07 → +11% on 2026-10-23 (5 weekly readings).
Where is Diamondback Energy in its 52-week range?
What is the short interest in Diamondback Energy?
7,295,434 shares short as of 2026-09-30 (FINRA settlement date). Reported twice a month, so this only changes roughly every two weeks, not daily.
What could go wrong with Diamondback Energy? Munger's inversion check
"Invert, always invert." Instead of reasons to buy, these are reasons to hesitate, not a verdict, and not everything worth knowing about a business.
- Margin of safety, even in the bull case +47%
- Short interest under 5% of float 3.4%
- Passes most of the 6 fundamental filters 4/6 passed
- Price run-up backed by value, not just momentum +44% off 52wk low
- Debt/equity stable since 2016 0.28 → 0.34
Doesn't cover circle of competence, management quality, or accounting concerns: those need judgment, not data.
How much have Diamondback Energy shareholders gained per year?
Not enough clean earnings history to compute this for FANG yet - a loss year in the window breaks the growth math rather than faking a number through it.
An earnings-based proxy, not a stock-price total return - it doesn't capture multiple expansion/contraction or reinvested dividends. EPS from FANG's own 10-K filings; dividend yield is the current trailing yield on today's price, from the same weekly fetch as the rest of this site.
What do Diamondback Energy's 10-year financials show?
From FANG's own 10-K filings (SEC EDGAR): up to the last 10 fiscal years. Press any year's bars for the exact figures.
Frequently asked questions about Diamondback Energy
What kind of company is Diamondback Energy?
Diamondback Energy is a US independent oil producer concentrated in the Permian Basin of West Texas and New Mexico, drilling shale oil wells. Brands and businesses it owns include Viper Energy. This site groups it with Energy stocks.
Is Diamondback Energy trading above or below its DCF value?
At $197.14, FANG trades 10.5% below this site's neutral DCF value of $220.30 per share, a margin of safety of +10.5%. That DCF projects free cash flow for 10 years, with growth starting at 8% and fading to 2.5%, discounted at 10%; it is one set of assumptions, not a forecast. Test your own in the Intrinsic Value Calculator.
How many of this site's 8 value filters does Diamondback Energy pass?
FANG passes 4 of 8. It passes Market Cap > $25B ($56.3B), Price/Book < 8 (1.48), Price/Sales < 7 (3.29) and EPS Growth YoY > -5% (+179.7%). It misses Trailing P/E < 25 (38.35) and PEG Ratio < 1.5 (5.42). vs 50-day MA (±12%) and vs 200-day MA (±12%) were not evaluated, because the moving-average checks only run on stocks that clear the fundamentals first. The 8-filter list shows every stock that passes all of them.
Are Diamondback Energy's reported earnings reliable?
This site's earnings-quality check rates FANG Mixed · 1 flag. Beneish M-score −3.03 · accruals −10.3% of assets · 259% of profit arrived as cash · share count +26.7% a year. From the latest 10-K (year to Dec 2025). Concerns: share dilution (flagged). The five checks are the Beneish M-score (manipulation risk), accruals, cash conversion, stock-based compensation and share dilution; the Earnings Quality Screener shows how each is graded.
How fast has Diamondback Energy grown its revenue and profit?
From fiscal 2016 to fiscal 2025, FANG's revenue grew from $527 million to $15.0 billion, 45.1% a year. Net income went from −$165 million to $1.7 billion, and its net profit margin from -31.3% to 11.1%. All figures are from FANG's own 10-K filings (SEC EDGAR) and are shown year by year in the 10-Year Financials section of the card above.
When does Diamondback Energy report earnings next?
Diamondback Energy's next earnings report is expected on November 2, 2026 after the market closes, with analysts expecting earnings of $5.54 per share. Dates come from the Finnhub earnings calendar and can move. In its last 4 quarters it beat the estimate 3 times, by an average of +4.1%.
Where do these numbers come from?
- Financial statements: Diamondback Energy's 10-K annual report for the year ended Dec 31, 2025, filed Feb 25, 2026 (filing index). Every earlier year in the 10-year financials comes from the company's older 10-K filings, all listed on SEC EDGAR.
- Prices and market data: quotes, P/E and analyst ratings from Finnhub; daily price history and the 52-week range from Twelve Data, both refreshed weekly. Short interest comes from FINRA, reported twice a month.
- How to check a figure: click any number in the card above to see its exact source, and read the Editorial Standards for every rule behind the checks.
About this Diamondback Energy Inc analysis
This page shows every value-investing check the site runs on Diamondback Energy Inc (FANG) in one place: the 8 mechanical filters, the Buffett and Lynch checklists, a margin of safety from a disclosed DCF, earnings quality, shareholder yield and how it ranks against its sector peers. The numbers come from SEC filings and public market data, refreshed weekly, and the same rules apply to every stock on the stock list. See Editorial Standards for the sources and the rules, or run your own filters in the stock screener.